Trading Psychology is one of the most important aspects of trading, it’s what most traders struggle at the beginning of their trading career. The idea of losing money drives that person to do irrational things out of fear, you will be surprised what human beings will do for money. The common reason why traders have a difficult time profiting is due to the reason that they can’t keep their losses short.
When people generate a large sum of In The Money Trades(ITM) and get one out of the money trade, their mind instantly indicates them that the next trade they’ll enter will turn out in the money since they were performing so “well”. That trader keeps on trading after their first loss even though they could have stopped when they had plenty of in the money trades. The real effect is that they keep on losing and their account balance keeps lowering. It makes them even more determine to continue and the final result would be an empty account before you even know it.
Trading Crypto Currencies is half knowledge and half emotions, the reason why we claim that is because there are lots of people who are incredibly smart but not every one of them trades because most of them are emotional guys who can’t deal with pressure. That’s why people who are in between have the easiest time to trade, you need to balance those two characteristics 50/50!!
You may be a very intelligent individual but if you are a guy who goes completely nuts over money, you’ll have a troublesome time when you run into losing trades. As for emotional people, you can be the calmest guy in this world and have a superb personality but if you don’t do your proper research, you’ll also have a hard time earning profits. That’s why learning trading psychology is so crucial to Crypto trading!!